"It was a pretty big sticking point," said Matt Brill, a portfolio manager at Invesco.

"Investors would have liked 102 or even 103. But given the thirst for yield, the issuer didn't have to go above 101."

Books for the deal, which Bank of America Merrill Lynch and Morgan Stanley began marketing on Tuesday, had swelled to more than US$10bn by noon - proving that the changes had helped alleviate investors' concerns.

The US$650m 40NC5 issue launched at 5.875%, inside IPTS of 6.625%-6.75%, while the US$650m 40NC10 launched at 6.25%, inside IPTs of 7% area.

'PHENOMENAL' CHANGES

Tax reform has been a big talking point in the corporate bond market over the past few weeks amid expectations of a major overhaul under President Trump.

Steven Mnuchin, Trump's Treasury Secretary, said on Thursday that he wanted to pass "very significant" tax reform before Congress breaks for its August recess.

Proposals include the elimination of the tax-deductible status of interest payments and changes to the rules on repatriation which could have a big impact on the cost of debt for issuers.

Most hybrid bonds traditionally include language allowing issuers to redeem the debt at par plus accrued interest if tax rules change - but investors are becoming increasingly sensitive to those clauses given the potential reforms.

Some buyside sources told IFR they would demand higher premiums on such language in future bond deals.